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HOW THIS IS MONEY CAN HELP

Meanwhile, the average easy access savings rate on the market is 0.35 per cent, according to campaign group Savings Champion, and millions of customers are languishing on rates as low as 0.1 per cent.

Nationwide’s figures are better than average, with its best account offering 5 per cent interest.

However, it is just available to existing customers and is a regular saver – so you can only deposit £500 a month rather than moving all your cash across in one go.

And many of its accounts pay well below inflation, with its tax-free, one-year cash Isa offering 0.65 per cent, and the two-year fixed bond 0.75 per cent.

Rennison said the building society had worked hard to limit the impact on savers.

‘We’re very carefully looking at everything we can do to support savers in a low-interest rate environment,’ he said.

‘We can’t defy gravity. Rates have come down less than most of our competitors, but they have come down and that’s unavoidable.’ It came as the lender revealed a 16 per cent fall in profit to £946m for the last nine months of 2016.

Bosses put this down to a squeeze in margins as competition for customers increased, particularly in mortgages.

Santander last week launched an 18-month fixed rate product at 0.99 per cent, taking the industry to near-record lows.

It has fuelled concern from campaigners that Britain is indulging in a dangerous debt binge.

Rennison said he felt the borrowing was sustainable but it was important to make sure borrowers were not landed with debt they would struggle to pay when Bank rates finally started to rise.

‘The risk that the industry is very alert to is a rise in interest rates,’ he said.

‘It’s the low rates that are making mortgages very affordable in the current environment.

‘It’s the risk we all have on our radar – at Nationwide, we’re confident we’re a prudent lender.’

The building society lent £26.2bn for mortgages in the period, up from £23.6bn a year earlier, giving it a 14.3 per cent share of the market.

Nationwide says it saw 570,000 new current accounts opened and pulled in £6.4bn of deposits, a rise of £1.5bn.